Oregon’s largest ethanol plant, dormant for more than three years, could roar back to life under new ownership.

While Oregon’s legion of clean energy advocates are sure to welcome the news, the plant formerly known as Cascade Grain has crude oil to thank for its revival.

Global Energy Partners LP, a Waltham, Mass.-based fuel marketer and distributor with more than $16 billion in sales, this week was expected to close on the $95 million acquisition of the Columbia Pacific Bio-Refinery in Clatskanie from Longview, Wash.-based construction firm JH Kelly. It is expected to use the facility, a deepwater marine terminal along the Columbia River, to both produce ethanol and move trainloads of crude from oil-producing regions in Canada and North Dakota.

The plant has the capacity to produce more than 110 million gallons of ethanol per year, but has been dormant for most of its existence.

The plant opened in Clatskanie in 2008, financed with $100 million in secured bank credit and a $20 million loan from Oregon’s State Energy Loan Program.

Cascade Grain became, to some, a symbol of a fracture in the state’s clean energy economic policies. Oregon lost most of its $20 million loan.

JH Kelly, which built the plant for Vancouver, Wash.-based Cascade Grain and was owed $25 million when it went bankrupt, acquired the facility in a December 2009 bankruptcy auction for $15 million.

JH Kelly executives at the time said they intended to restart the plant with an eye toward selling it. Kelly, though, never resumed production, especially after a Midwest drought last year affected both the price and production of corn — ethanol’s primary feed stock — leading to the first decline in U.S. ethanol production in 16 years.

Instead of sitting idle, JH Kelly made capital investments to upgrade the facility. That included getting a bulk fuels terminal originally planned by Cascade Grain up and running.

Oil route began in November

By November, the terminal was accepting large unit trains of crude oil.

Targeting the oil business was intentional, said JH Kelly President Mason Evans. JH Kelly, through its construction work, has worked on refineries and developed an understanding of how crude oil flows.

With domestic production from sources like North Dakota flowing into the market, oil transport is shifting from pipelines to trains and other methods.

That ability to handle those shipments and load them onto other vessels helped make the facility attractive to Global Partners.

Though Global didn’t respond to questions, Evans said the company — a major distributor of oil and natural gas and operator of East Coast gas stations — is a major mover of renewable fuels like ethanol and plans to produce ethanol at the facility.

Though Global mentions ethanol in its news release, much of the announcement focuses on how the plant will give the company a way to supply both crude and ethanol to West Coast refiners from North Dakota’s oil-rich Bakken region. The Clatskanie site is linked via BNSF rail to a transloading facility in Beulah, N.D.

“Given the 3.3 million barrels a day of crude refining capacity in (the West Coast), this facility represents an opportunity for Global to drive additional product volumes and enhance margins,” Global CEO Eric Slifka said in a news release.

While it’s unclear how much ethanol Global plans to produce from the Clatskanie plant, the market in Oregon is rich with potential.

Oregon last year consumed 2.1 billion gallons of gasoline, of that about 210 million gallons came from ethanol, thanks to state and federal renewable fuel standards, said Rick Wallace, a senior policy analyst with the Oregon Department of Energy.

But of that 210 million gallons of ethanol, just 40 million gallons was sourced from Oregon.

“The companies that make it here would probably have a bit of, I would say, a competitive edge,” Wallace said.